ASX NEWS & VIEWS

Qantas Airways Provides Trading Update for Q3 2018

The Qantas Group has announced a strong performance in its trading update for the third quarter of FY18 and confirmed it is on track for a record Underlying Profit Before Tax full year result.

The third quarter follows the Group’s record half year result in February and has been underpinned by positive market conditions, capacity discipline and ongoing transformation.

Overall, total revenue for the three month period ending 31 March 2018 was up 7.5 per cent to $4.25 billion compared with the same period last year, and Group Unit Revenue (RASK)2 increased by 6.0 per cent.

Group Domestic3 Unit Revenue increased by 8.0 per cent compared to the prior corresponding period. This reflects strong demand across key markets, including continued recovery of the resources sector and gains within the small-to-medium enterprise segment.

The timing of Easter, which fell partly in the third quarter in FY18 compared with the fourth quarter of FY17, also increased demand for leisure travel compared with the prior corresponding period. Group Domestic capacity decreased by 1.9 per cent.

Group International4 Unit Revenue rose by 5.2 per cent. This performance was driven by underlying demand growth and higher load factors, as well as the benefits of ongoing network adjustments to better match demand. Qantas Group International capacity grew by 2.3 per cent while total market capacity grew by 5.0 per cent.

In late March, several important changes to the Qantas International network took effect – the start of the Perth-London route, the switch from Dubai to Singapore as the hub for Qantas’ second London service and a renewed partnership with Emirates that has seen Qantas increase its Trans-Tasman

flying. The customer and financial upside to these changes is significant and will deliver benefits to Qantas International’s performance from FY19 onwards.

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